Spotify is making programmatic audio ads available on its platform in a bid to boost revenue from the free tier of its service before its IPO.

Even though only 30 million of the company's total 100 million user base are paid subscribers, subscriptions still generate the bulk of its revenue (they accounted for almost 90% of the $2.19 billion total in 2015).

For the first time, advertisers will be able to automatically buy Spotify ad inventory according to user age, gender, and music tastes. These transactions will occur within a private programmatic marketplace, built on the IAB's Programmatic and Open-RTB Protocol 2.4. Programmatic ad spending is expected to reach $20 billion this year, according to Magna Global estimates, and Spotify is aiming for at least $10 million from this market, according to Les Hollander, the company's global head of audio monetization.

Other steps Spotify is taking to build out its ad business and achieve more balance between the two revenue streams include:

Sponsored playlists. Spotify is allowing marketers to sponsor the music-streaming service's owned and operated playlists, Ad Age reports. Brands were previously able to create their own playlists, but could not sponsor Spotify's own playlists. Spotify's playlists generate more than 1 billion streams per week, and the most popular playlist "Today's Top Hits" has around 8.3 million followers, as of May.

Internal trial of the "free" service. In early June, all Spotify tech and product employees were mandated to use Spotify's free, ad-supported service for a five-day period, to ensure that they understood the user experience.

Consumers are disinclined to pay for music streaming subscriptions, which explains Spotify's focus on increasing revenues with ads. Only one out of 10 digital consumers pay for the privilege of streaming music, according to a study by GlobalWebIndex.

The company is also facing difficulties on several other fronts:

Pressure to IPO sooner rather than later. Spotify's $1 billion funding round in March did not come without strings attached, Bloomberg reports. The funding round included terms that allowed investors to convert their stakes into shares at a 20% discount to the IPO price, and this discount will continue to grow until Spotify's IPO date.

Increased competition among music streaming services. Spotify's incumbency in the music streaming space is under increasing threat from its rivals, especially Apple Music. Apple has stated that music is the center piece of its content strategy, and Apple Music has already amassed 15 million subscribers in just over a year. Meanwhile, Spotify recently accused Apple of using the App Store as a "weapon" to limit competition, after a Spotify app update was blocked in the App Store Review.